Analysts: The possible inflation at the end of the year is 7%.

According to economists, the decline in the consumer price index will be slower than at present, and consumer inflation will be around 7 percent. at the end of the year.

According to them, the Monetary Policy Council (MPC) could continue the process of cutting interest rates by 25 to 50 basis points next week. On a monthly basis, inflation showed a sharp decline of -0.4% in September. m/m, the highest since January 2016, mainly due to fuel prices.

As reported by the Central Bureau of Statistics (GUS) on Friday, consumer inflation stood at 8.2%. on an annual basis in September 2023, according to preliminary data. Compared to the previous month, prices of consumer goods and services fell by 0.4%.

Economists estimate a decline in core inflation in September to around 8.5-9 percent. y/y 10.1 percent reported in August. Analysts indicate that the decline in inflation will support the recovery in consumption. According to some economists, the scope for further interest rate cuts in 2024 is limited in this context.

The opinions of economists

“In the coming months, the pace of decline in the CPI will be slower, partly due to last year’s “stable” reference base, but also due to seasonally rising food prices and the very likely recovery in fuel prices. In the last quarter of this year Inflation could be around 7%. y/y. Current forecasts indicate that inflation could start to accelerate again from March 2024,” said Monika Kurtek, chief economist at Bank Pocztowy.

“In the coming months we expect a slight decline in inflation. The pace of change will be much slower than before. The increase in oil and grain prices on food markets will increase inflation,” said Sebastian Sajnóg, analyst at the Polish Economic Institute. Institute (PIE) – macroeconomic team.

“We expect inflation to decline at a slower pace in the coming months, reaching around 7.3% in December. Such a sharp price drop will provide additional support for another rate cut, perhaps by 25-50 basis points. The Polish zloty has stabilized after an unexpected interest rate cut of 4.6 against the euro, so currency pressure against further monetary policy easing has also diminished,” said Jakub Cery, analyst at Erste Grop.

Source: Do Rzeczy

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